This year’s report from PwC’s Health Research Institute
Finds that the medical cost trend is expected to increase from 8% in 2011 to 8.5% in 2012. An interesting blend of reactions to the recession, the slow recovery, health reform, and other variables are factored into the medical cost trend in 2012.
The report shares key findings, which include an explanation of trends contributing to rising costs (accelerators) as well as decreasing cost trends (deflators).
Key accelerators:
- Provider consolidation continues.
- Cost-shifting from Medicare and Medicaid increases.
- Post-recession stress builds upon the workforce.
Key deflators:
- Blockbuster brand name drugs go off patent.
- Tiering on out-of-network providers is put in place.
- High-deductible plans force more cost-sharing.
Following rising healthcare costs, the responsibility for it is not being owned up by anyone. Everyone is shifting the blame on another and as groups seek to pin the problem on each other they also say that the new healthcare legislation is not doing anything to solve it.
According to federal estimates, the U.S. spending on health care in 2009 was $2.5 trillion. In 10 years, it is expected to jump to $4.5 trillion. Insurers are competing to pass on ever-higher bills from hospitals and doctors. If you listen to hospitals, they say that they are having a tough time with more uninsured patients, top salaries being demanded by doctors, and underpayments from Medicare and Medicaid.
Doctors have their own story and they feel being strong-armed by insurance monopolies and hampered by medical malpractice costs. Certain solutions are surfacing in the rush to point fingers. Robert Laszewski, president of the healthcare consulting firm Health Policy & Strategy Associates said, “It’s always someone else’s fault. There is not an incentive for these people to cooperate because the game they are all playing is getting a bigger piece of the pie.”
